July 18, 2018 / 4:35 PM / 4 months ago

Chanos shorts Envision, says KKR may get cold feet on deal

NEW YORK (Reuters) - Hedge fund manager Jim Chanos says he is betting that the stocks of physican practice management companies Mednax (MD.N) and Envision Healthcare EVHC.N will fall and said that private equity group KKR might get cold feet on a planned deal for Envision.

Chanos, whose Kynikos Associates tends to sell stocks short, warned there is a chance that KKR (KKR.N) could back out of the roughly $10 billion deal.

“This KKR $10 billion deal is going to have to borrow money to pay interest from the get-go, in our view,” Chanos said at the CNBC Institutional Investor Delivering Alpha Conference.

“We are staying short, EVHC. We don’t think it’s a negligible chance that the deal might break as KKR realizes what it’s buying.”

He called the physican practice management companies “ticking time bombs” and said these businesses “earn nothing.”

Reporting by Svea Herbst-Bayliss and Joshua Franklin; Editing by Dan Grebler

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